Energy Efficiency 2018
Analysis and outlooks to 2040
"Efficiency can enable economic growth, reduce emissions and improve energy security. The right efficiency policies could enable the world to achieve more than 40% of the emissions cuts needed to reach its climate goals without new technology."
Fatih Birol, Executive Director, IEA
Energy efficiency can bring significant economic, social and environmental benefits. But while energy efficiency is improving around the world, its positive impact on global energy use is overwhelmed by rising economic activity across all sectors.
Energy Efficiency 2018 looks at why efficiency’s massive potential remains untapped, and through the new Efficient World Scenario explores what would happen if countries maximized all available cost-effective efficiency potential between now and 2040, highlighting what policy makers can do to realise this opportunity.
Key Findings
Energy efficiency works ...
The impact of efficiency policies has been significant over the last decades. Globally, efficiency gains since 2000 prevented 12% more energy use than would have otherwise been the case in 2017. Energy efficiency is a major driver for uncoupling energy consumption from economic development.
GDP Energy use Energy use without energy efficiency 2000 100 100 100 2001 102.38 100.5 100.83 2002 105.34 101.99 102.84 2003 109.63 105.06 106.43 2004 115.35 109.66 111.45 2005 120.85 113.17 114.98 2006 127.26 115.89 120.15 2007 134.13 119.19 125.23 2008 137.99 121.04 128.46 2009 137.37 119.64 126.88 2010 144.59 125.88 132.77 2011 150.53 127.81 135.98 2012 155.49 129.04 138.22 2013 160.72 131.66 141.8 2014 166.31 132.48 143.86 2015 171.84 133.81 146.57 2016 177.2 135.61 150.17 2017 183.72 137.99 153.87
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... but that's still not enough
Since 2000, these improvements in the world’s major economies have offset more than a third of the rise in energy-intensive activities.
But the positive impact of efficiency policies has been overwhelmed by fast-growing economic activities in emerging countries that boost energy demand.
As a result, growth in energy use is accelerating
Global energy demand rose by nearly 2% in 2017. This was the fastest rise this decade, driven by economic growth and changes in consumer behaviour.
Global primary energy demand Global primary energy demand 1.5 0 1.5 0 1.3 0 1.2 0 0.4 0 0.6 0 0 2
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Missed opportunities
The world is missing opportunities to improve energy efficiency and today's policies are not delivering the full potential gains that are cost-effective and use current technology. This delayed action on energy efficiency ends up locking in inefficiencies that mean much stronger action needs to be taken in the future.
With stronger policies in place, last year the world could have saved more than …
2.2 million barrels of oil per day if all countries had adopted the best passenger fuel economy standards
16% of industry electricity use if all countries had adopted the strongest electric motor standards
$20 billion if everyone had purchased the top 10% most efficient refrigerators
The Efficient World Scenario
So what will the world look like if between now and 2040 countries implemented all the economically viable energy efficiency potential that is available? The potential is demonstrated by the Efficient World Scenario developed by the IEA World Energy Outlook.
The Efficient World Scenario (EWS) shows a world with 20% more people, 60% more building space and double the GDP, all for a marginal energy demand rise. The EWS also fully delivers the energy efficiency target of UN Sustainable Development Goal 7. All of the measures implemented in this scenario are cost-effective, based on energy savings alone, and use technologies that are readily available today.
Significant energy productivity
Under the EWS, the amount of global GDP produced for each unit of energy could double between now and 2040, for only a marginal increase in global energy demand.
Primary energy demand GDP Energy intensity 2000 100 100 100 2001 100.9202171 102.3798011 98.57434373 2002 103.0679049 105.3428466 97.84044027 2003 106.6972756 109.625601 97.32879413 2004 111.4796021 115.3548141 96.6406153 2005 114.4940249 120.8470414 94.74292763 2006 117.8531697 127.2599593 92.60820949 2007 121.0004846 134.1268484 90.21347036 2008 122.4274088 137.9861216 88.72443647 2009 121.4042486 137.3650489 88.38074139 2010 128.1794056 144.5926035 88.64866013 2011 130.0994861 150.5297701 86.42774517 2012 132.0963366 155.4899051 84.95492783 2013 133.7661984 160.7214955 83.22856753 2014 135.420733 166.3138612 81.42480246 2015 135.930098 171.8429952 79.10133192 2016 136.6686525 177.2039716 77.12505047 2017 139.3606633 183.7214644 75.85431769 2025 144.35664 243.984617 59.16628754 2030 146.1132126 291.2249247 50.17194621 2035 147.3607783 342.4311707 43.03369286 2040 149.398847 395.535594 37.77127755
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Immediate environmental benefits
The EWS would result in a peak in energy-related greenhouse gas emissions before 2020, followed by a fall by 12% in 2040 compared with today - equal to over 40% of the abatement required to be in line with Paris targets. The EWS would also cut key air pollutants such as sulphur dioxide, nitrogen oxides and particulate matter by one third compared to today. In particular, more efficient cooking could help reduce premature deaths from household air pollution by almost 1 million per year in 2040 in comparison with the IEA New Policies Scenario (NPS).
Energy savings in emerging economies
Emerging economies could become 50% less energy intensive under the EWS, with China and India accounting for one third of total energy demand in 2040. These two countries would also account for over one third of the total energy demand savings, which would translate into savings of nearly $500 billion in fossil fuel imports.
What will it take?
The EWS shows that energy efficiency could deliver significant economic, social and environmental benefits, but only if governments take greater policy action. However, the scale up in policy action must start immediately and there are good examples of policies in all end-use sectors that can form the basis for greater action.
Transport energy demand could stay flat to 2040, despite a doubling of activity
Making this happen will require stronger and broader fuel economy standards for both cars and trucks, as well as policies for non-road transport. Incentives can support adoption of more efficient vehicles and electrification of various modes of transport, with information and capacity building to support more efficient transport choices.
We could have 60% more building space in 2040 for no additional energy use
This would require comprehensive efficiency policies, targeting new and existing buildings as well as appliances. Incentives could drive consumers to adopt high efficiency appliances and undertake deep energy retrofits, with market-based instruments encouraging innovative business models. Decision making can be supported by improved quality and availability of energy performance information.
Industry could produce nearly twice as much value per unit of energy in 2040
The majority of energy savings could come from less energy-intensive sectors like food, beverage and textile manufacturing. To realise these savings, performance standards for key industrial equipment, including electric heat pumps and motors, can be complemented by incentives to increase the adoption of energy management systems and improved information.
However to realise these opportunities, average annual energy efficiency investment must double to 2025 and then double again to 2040.
Yet all investment opportunities in the EWS are highly cost-effective and would bring significant economic benefits. Policy will need to facilitate finance and business model innovation to realise this investment opportunity.
2017 EWS Current 236 0 Average annual 2017-25 0 584 Average annual 2026-40 0 1284
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